Indian ferro chrome prices dropped w-o-w due to soft demand in both the domestic and export markets. SteelMint assessed ferro chrome offers at INR 105,000-106,000/tonne (t) exw on 10 November.
Most of the buyers in the domestic market were waiting for Vedanta’s auction on 10 November to get concluded for a clear picture. Hence, very few transactions were recorded in the week under review.
Buyers were anticipating a price drop but producers did not lower their offers any further considering high production costs. Some buyers even sought material at around INR 104,000/t.
Factors weighing on Indian ferro chrome prices-
- Subdued domestic demand: The domestic market was quiet as many buyers awaited Vedanta’s ferro chrome auction which took place today. High inventory and muted demand compelled producers to lower their offers.
- Weak export demand: Demand in the exports market, primarily from China, remained low. Some regions in China are under lockdown due to the resurgence of the pandemic, with no word on when the lock down will be lifted. According to credible sources, cargoes cannot be moved in or out under the current conditions. Moreover, Chinese buyers were seeking material at around 90-93 cents per lb on CNF basis, but selling at such lower prices was not viable for Indian exporters.
- Stainless steel prices on downtrend: Weak stainless steel demand and a decline in its prices also put pressure on ferro chrome prices. As on 8 November, Indian stainless steel (304 grade, HRC) prices were assessed at INR 255,000/t exw-Mumbai, down by INR 2,000/t w-o-w.
Outlook
A hefty volume of imported semi-finished stainless steel from Indonesia is set to arrive at Indian ports soon, as per SteelMint reports. This is likely to slow down demand of ferro chrome among Indian stainless steel producers, impacting its prices in the coming weeks.
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